5% First Home Loan Deposit Scheme Expands Early: Will It Push Prices Higher?

September 3, 2025

The much-talked-about home loan deposit scheme is set to roll out sooner than expected, opening the door for more buyers to purchase with just a 5% deposit. But there’s a twist. With the early expansion, some experts warn that buyers may want to move quickly before property prices shift upward.


The Home Guarantee Scheme (HGS) is at the heart of this change. It allows first home buyers to enter the market with only a 5% deposit while avoiding lenders' mortgage insurance (LMI).


Currently, the HGS is only available to a limited pool of buyers who meet strict income caps and property price limits. Places are also capped each year, meaning many miss out.


Originally slated for expansion in 2026, the changes will now take effect from 1 October 2025.


That’s welcome news for anyone saving hard for a deposit. But it could also mean increased competition and higher prices once the new rules take effect.


How the First Home Loan Deposit Scheme Works


With housing affordability stretched, scraping together a 20% deposit can feel impossible. That’s why an Australia first home loan deposit scheme, through the HGS, has become such a lifeline. 


Since its launch in 2020, the scheme has helped more than 230,000 first home buyers use the program to secure a property with just a 5% deposit.


While the HGS doesn’t hand out cash, it delivers savings in another way. By guaranteeing part of your loan, the federal government removes the need for LMI – a cost that can otherwise add tens of thousands of dollars to your home loan.


What’s Changing in the 5% Home Loan Deposit Scheme


Here’s what else is on the way: From 1 October 2025, every first home buyer will be able to apply under the HGS, which is also known as the Australia first home loan deposit scheme.



Housing Minister Clare O’Neil has framed these changes as a way to help Australians buy sooner, with fewer roadblocks.


Why the Australia First Home Loan Deposit Scheme Could Affect Prices


The early start of the first home loan deposit scheme through the HGS could trigger price movements. The Insurance Council of Australia predicts property values could rise by up to 10% in the first year in hotspots popular with first home buyers.


Across the country, prices climb between 3.5% and 6.6%.


The reasoning is simple: boosting demand in a tight housing market usually leads to upward pressure on prices. That’s why some buyers may find it makes sense to act sooner rather than later.


Take the Next Step with Osinski Finance 


No one can say for certain how the property market will respond once the new rules start. What is certain is that owning a home often feels more rewarding than paying rent.


You also don’t have to wait until October. If you meet today’s income and property caps, you may already qualify for the HGS.


 At Osinski Finance, we help first home buyers navigate the home loan deposit scheme, simplifying the process so you can clearly understand your options and move confidently toward owning your first home. 


Alongside helping first home buyers, we also offer expert support with home loans and property investment, giving you the confidence to plan for today while building for the future.


Contact us today to discover if you’re ready to secure your first home loan deposit scheme. You may be closer to owning your first home than you realise.


Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Updates

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By Dave Barbeler • September 10, 2025
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Refinancing Home Loan: 1,000 Aussies Switch Daily

By Dave Barbeler • August 27, 2025
Since February, three rate cuts have prompted homeowners across Australia to review their mortgages. Many have found better deals through home loan refinancing. More than 100,000 home loans were approved in the past quarter. This week, the ABS reported that 1.26 million home loans have been refinanced over the past three years. Refinancing first surged during the RBA’s rate hikes in 2022 and 2023. Now that rates are falling , demand for refinancing remains as strong. In the June 2025 quarter alone, almost 100,000 mortgages were refinanced. That equals more than 1,000 home loans for refinancing every day, the highest level since September 2023. So, why are Australians turning to refinancing in such large numbers? Saving on Loan Interest and Cutting Repayments Through Refinancing The RBA’s rate cuts this year total 0.75%. That has delivered some relief. Yet many borrowers are achieving far greater savings by choosing a refinancing home loan. According to Canstar , a borrower with a $600,000 loan could save more than $12,000 in two years by switching to a lower-rate loan. This assumes they have not renegotiated their rate in the past three years. For many Australians, that is the case. A Finder survey also shows that over half of homeowners do not know their current interest rate. This lack of awareness means many are paying more than necessary instead of exploring home loans for refinancing. Accessing Home Equity Through Home Loan Refinancing Refinancing a home loan is not just about securing lower repayments. It also allows borrowers to unlock the equity in their property. Property values have risen 45% nationally in the past five years and are 65% higher than they were a decade ago. This growth gives borrowers more flexibility to use refinanced home loans to fund: Home renovations Children’s education An investment property purchase Debt consolidation at a lower rate Upgrading to a Home Loan for Refinancing That Works Better Many borrowers choose refinancing to improve loan features. These features may include: Offset accounts to cut interest Flexible repayment options The ability to split between fixed and variable rates A redraw facility for extra repayments If your current loan does not offer these features, refinancing could deliver more flexibility and long-term value. Why It Pays to Act Now on Refinancing a Home Loan In the last quarter, over 100,000 Australian families refinanced their mortgages. They secured lower repayments, unlocked equity, or upgraded loan features. Waiting longer only means paying more on an outdated loan. At Osinski Finance , we make home loan refinancing simple. We offer services in home loans , property investment , and refinancing your home loan . Whether you want to cut repayments, access equity, or enjoy smarter features, our experts compare hundreds of options and handle the process for you. Contact us today and let us help you find the best home loans for refinancing so you can save money and move forward with confidence Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.